Glian is located in Western Europe (circa 1920). The flag appears, very briefly, in episode 6, hanging on a government building about to be blown up by terrorists.

The butterfly-like symbol is actually supposed to be a highly abstract representation of the Glian Coat of Arms: a winged globe with two crossed, downward-pointing swords in front of and below it.
Eugene Ipavec, 26 December 2005